How Cryptocurrencies Aid in Disaster Relief

Uncategorized
Mar 19, 2018

The distributed ledger technology working behind cryptocurrencies has proven to be a disrupting technology for commercial and non-commercial industries across the globe. Blockchain technology, through an immutable, decentralized and transparent network, ensures secure storage and exchange of digital assets and confidential data. Startups have adopted a range of blockchain projects to have efficient work solutions in their respective industries including financial services, real estate property, cloud computing, supply chain and logistics management, healthcare, music, e-voting, and CSR sector. Amid these, disaster relief has risen as a new sector where blockchain technology and cryptocurrencies can reduce inefficiencies in disaster relief in order to make this critically important and sensitive process smoother, safer and more efficient.[1]

The Problem

Each year, many parts of the world face natural disasters of different magnitude. From landslides and floods in South Asia to hurricanes and storms in Caribbean, these natural disasters affect millions of lives[2], resulting in casualty, and displaced-people without proper shelter and food. The cost of disaster relief is also increasing with every passing year. Millions of dollars were put into Hurricane Harvey relief program in Texas[3], for instance, but it was still hard for the authorities to know and track exactly how efficiently the money was used.

How Can Cryptocurrencies Help?

The transparent and decentralized blockchain based transactions using different cryptocurrencies, can transform the way disaster relief programs are executed across the world. Cryptocurrencies like bitcoin and Ethereum are already on their way to support Texas hurricane affected people and Syrian refugees.

For all the advantages offered by cryptocurrencies for disaster relief, the question is how to distribute coins and how can people use them easily. Here, blockchain based disaster relief platforms like Bitnation and Telcoin, come into play. Bitnation has been helping refugees by providing them blockchain relief IDs and visa cards[4]. Though in a refugee camp, it is feasible, yet it is not easy to predict when the next disaster will hit. Similarly, Telcoin provides a novel solution for coin distribution and usability by venturing with current mobile supply platforms. As it comes out, a big portion of people extremely prone to natural disasters belong to those regions where mobile money is under widespread use.

By developing a disaster relief and help-spending mechanism leveraged on blockchain technology, much of the red tape and bureaucracy can be eliminated while having speed, efficiency and transparency at the same time. Using blockchain, all the relevant payments can be processed in an efficient and faster manner, and most importantly, this enables making payment extremely easier and ensures complete transparency.

The Case of Building Blocks

The United Nations WFP (World Food Program)[5] introduced a blockchain program, “Building Block”, in January 2017. The program was put on pilot. The WPF is the food aid branch of the United Nations, which addresses hunger and promotes food security in under-developed, developing and crisis-stricken regions.

At present, Building Blocks is testing key assumptions and capability of blockchain to verify, save and revalidate assistance transactions, in rural areas of Pakistan, a South Asian country. The program’s beneficiaries got in-kind cash transfers and food, coded into WFP’s public blockchain. This blockchain recorded and validated the transactions to form trust between parties involved in this process. The website of the program reveals the news of project’s success in the region and therefore, the program will be extended to the regions soon.

Bitcoin offers many benefits to most of the industries in the world. It is an incredibly transforming technology to initiate low-cost global payments, with instant availability. For the charities working around the world, cryptocurrencies bring an ideal mix of capabilities to help fuel their efforts and bring timely relief to those affected by natural disasters. The increasing number of blockchain based disaster relief platforms, reflects the significance and usefulness of blockchain technology and cryptocurrency based transactions for saving millions of lives worldwide. It is also the source of saving billions of dollars currently going into traditional, of-no-use, disaster relief programs that are inefficient, mutable, and not speedy and transparent.

The Bottom Line

While the technology of blockchain us disrupting many commercial sectors, it is promoting a novel way by which disaster stricken people can be reached and helped. Once disaster relief payments and other transactions operated on the blockchain are accessible to NGOs globally, help will reach faster in disaster stricken regions and lives will be saved.